It may not seem like it, but the stock market has a lot at riding on the outcome of tomorrow's National Football League conference championship games. That is, of course, if you believe in the Super Bowl Indicator, a nefarious equity performance index that attempts to show a correlation between the NFL champion and stock market performance.
According to the index, the stock market performs better when an NFC team wins the Super Bowl, and it has been right 80% of the time. Tomorrow the Seattle Seahawks and San Francisco 49ers square off the for NFC conference title and the Denver Broncos and New England Patriots play for the AFC conference title, with the winner of both games facing off in the Super Bowl.
But correlation is not causation, and many believe that the Super Bowl Indicator is little more than a fun spreadsheet exercise.
Still, according to responses from 90 institutional investors to a quarterly poll conducted by Citigroup, either the Broncos or Forty-Niners will win this year's Super Bowl.
"For those who want to go down this deceptive path, San Francisco has won the big game five times and it has been reported that in four of those years, the stock market registered some of its best annual gains since 1967," Citi researchers led by Tobias Levkovich wrote in the report.
But, as the researchers properly caution, "we suspect that there are far better means to analyze stocks."